Relevant of differential cost analysis takes all variable and fixed costs into account to analyze decision alternatives considers only variable costs as they change with each decision alternative considers the change in reported net income for each alternative to arrive at the optimum decision for the company O considers all variable and fixed costs as they change with each decision alternatives The term that refers to costs incurred in the past that are not relevant to a future decision is full absorption cost sunk cost incurred marginal cost under allocated indirect cost

Relevant of differential cost analysis takes all variable and fixed costs into account to analyze decision alternatives considers only variable costs as they change with each decision alternative considers the change in reported net income for each alternative to arrive at the optimum decision for the company O considers all variable and fixed costs as they change with each decision alternatives The term that refers to costs incurred in the past that are not relevant to a future decision is full absorption cost sunk cost incurred marginal cost under allocated indirect cost

Name: Relevant of differential cost analysistakes all variable and fixed co
Uploaded: 2024-03-20T06:32:37.000Z
Channel: Bartleby
Description: Relevant of differential cost analysistakes all variable and fixed costs into account to analyze decision alternativesconsiders only variable costs as they change with each decision alternativeconsiders the change in reported net income for each alt

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: What is the Breakeven formula when a profit is included: Group of answer choices c. Fixed Costs –…

A: Break-even point is the point at which there is no loss or no profit. It is because the sales…

Q: When absorption costing is used a. management may be tempted to overproduce in a given period in…

A: Absorption costing is a method of calculating the cost of a product or enterprise by taking into…

Q: Which of the following is not a true statement about variable costs? O a. Total cost is known to…

A: Variable Cost Variable cost which is described as the cost which are incurred to the business entity…

Q: Why do managers consider Direct Coasts to be more accurate than Indirect Costs? How do managers…

A: Direct costs are the costs which are directly identifiable in the manufacturing process. Indirect…

Q: Which of the following best describes an "opportunity cost"? Expected future costs that differ…

A: Introduction: Opportunity cost: Cost for the opportunity lost called opportunity cost.

Q: Within the relevant range of activity fixed costs remain constant in total costs and activity can be…

A: A certain activity level that is limited by a minimum and maximum quantity is referred to as the…

Q: Gross margin is to absorption costing as which of the following is too variable costing? A.…

A: Variable costing uses Contribution Margin Income Statement by showing Sales – VARIABLE expenses =…

Q: In preparing a relevant cost analysis when operating a full capacity, the analysis should consider…

A: Relevant cost analysis is use to choose one alternative out of available alternatives, this is…

Q: Which of the following is NOT true about the cause-and-effect criterion when estimating a cost…

A: The cause and effect analysis is one of the factors for making cost allocation decisions. The cost…

Q: Complete the following statements with one of the terms listed here: You may use a term more than…

A: The objective of the question is to fill in the blanks with the appropriate cost terms from the list…

Q: What is variable costing? How does it differ from absorpotion costing? Which can better be used to…

A: Variable Costing is a costing method where variable expenses change in proportion with production.…

Q: costs that change proportionately according to the changes in the cost driver.......

A: variable costs are the costs that change according to the changes in the cost drivers or changes…

Q: On a cost-volume-profit graph, when the Total Cost line is higher than the Total Revenue line, the…

A: Solution:- Cost-volume-profit graph is the graph which measures the loss, profit and break-even…

Q: 1. Multiple-Choice Question - FIFO When using FIFO, A) Identical costs go to the balance sheet and…

A: FIFO is one of the inventory valuation method being used in business. FIFO means first in first out.…

Q: Which costing system is helpful for internal managers when they're trying to make a short- term…

A: Cost Accounting is a process of identification, classification, measurement, and assignment of costs…

Q: In a drop or continue decision, only the variable costs identified with a product are relevant in a…

A: The given statement is true.

Q: In making a short-term special decision, which of the following is MOST important? a. Use a…

A: Solution Concept The decision that is to be taken differs from one another on the basis of the time…

Q: The line that begins at the origin on a CVP graph represents total expenses. total fixed…

A: Since you have posted multiple questions , we will do the first one for you. If you want any…

Q: Product costs under variable costing are typically: Group of answer choices A. higher than under…

Q: Lassen Corporation issued ten-year term bonds on January 1, 2020, with a face value of $800,000. The…

A: Bond is an investment security with low risk and low return. A fixed rate of interest is attached…

Q: Which of the following cost behaviors cannot be accurately represented by a single straight line? A.…

A: Cost behaviours break down into four expense classifications as follows…

Q: Cost-volume-profit analysis is used for ________. analyzing the effects of changes in costs on…

A: Cost volume profit analysis is designed for profit forecasting at varying levels of sale volume and…

Q: Relevant range is the activity that affects the increase or decrease of costs Select one: O True…

A: Lets first understand the meaning of relevant range. Relevant range is a range at which fixed cost…

Q: Which of the following statements is true of ABC systems? A) ABC systems are time-driven cost…

A: Activity-based costing (ABC) is a method of assigning overhead based on activities, which are…

Q: In incremental analysis, the only costs to be considered are O relevant costs. sunk costs. O…

A: The incremental analysis uses those items that are relevant in aiding business decisions. These…

Concept explainers

Inventory Valuation

Before discussing the topic inventory valuation let’s discuss the meaning of inventory. In accounting, inventory is also known as stock. Inventory means all the finished goods, materials, merchandise that a business holds for the purpose of selling it in the market with the motive of earning profit.

Topic Video

Question

Relevant of differential cost analysis
takes all variable and fixed costs into account to analyze decision alternatives
considers only variable costs as they change with each decision alternative
considers the change in reported net income for each alternative to arrive at the
optimum decision for the company
considers all variable and fixed costs as they change with each decision alternatives
The term that refers to costs incurred in the past that are not relevant to
a future decision is
full absorption cost
sunk cost
incurred marginal cost
under allocated indirect cost

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Introduction :

VIEW

Relevant or Differential Cost analysis :

VIEW

Requirement 2 :

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Which type of income statements, Contribution Format or Traditional Format should be used to identify relevant costs? Please provide explanation for your answer. Then provide an example including two income statements based on absorption and variable costing, respectively, to support your explanation.
Fixed costs are costs that: A) Change in total with changes in the level of activity B) Remain constant per unit with changes in the level of activity C) Remain constant in total regardless of changes in the level of activity D) Vary inversely with changes in the level of activity
Which of the following statements regarding marginal costing is incorrect? Select one: O A. It is useful long-term planning technique OB. It assumes that fixed costs remain fixed over relevant activity ranges O C. It assumes that variable costs vary in proportion to activity O D. It assumes that costs can be classified as variable or fixed
A cost that cannot be changed because it arises from a past decision and is irrelevant to future decisions is a. An uncontrollable cost. d. An opportunity cost. b. An out-of-pocket cost. e. An incremental cost. c. A sunk cost.
Which of the following is not a method used by managers to determine cost behavior? High-low Method Scatterplot Account analysis Regression Analysis Derivation
Describe the differences in behavior of fixed costs, variable costs, semi-variable costs and step costs. Then discuss how break-even analysis and contribution margin can be useful in making business decisions.
When the total contribution margin is greater than total fixed costs, a company has Select one: a. Higher variable cost and fixed cost. b. A net loss c. Zero profit. d. Net income.